
Abstracts
Talk
The Macro Model of the Inequality Process Explains a Quirky Aspect of
U.S. Wage Incomes, 19612003: The Surge in Wage Income Nouveaux Riches
John Angle
Inequality Process Institute, Post Office Box 429, Cabin John, Maryland, USA
Abstract:
The macro model of the Inequality Process (IP) is derived from
the solution of the IP's micro model and approximates its
stationary distribution. The micro model is a stochastic
interacting particle system in which a positive quantity is
exchanged between pairs of particles. The macro model is a gamma
pdf whose parameters are given in terms of the IP's
parameters. The IP version discussed in this paper is:
Randomly pair particles. Let one of these pairs be particle i
and particle j. A fair coin is tossed and called. If particle
i wins, it receives an ω_{θ}
share of particle j's wealth. If particle j wins, it receives an
ω_{ξ} share of particle i's
wealth. The other particle encounters are analogous.
Repeat for all particles.
Particle i's ω_{ξ}'s does not change. Whenever it loses,
it loses an ω_{ξ} share of its wealth. The IP's metatheory
relates ω_{ξ}'s to worker productivity
(more productivity, smaller ω_{ξ}).
Angle (1983, 1993, 2003, and 2006) has shown that the IP
explains a large number of quantitative and qualitative
aspects of the distribution of wage income conditioned
on productivity. In particular, Angle (1999, 2006) shows
that the macro model of the Inequality Process provides
a parsimonious fit to the U.S. wage income distribution
conditioned on education. Such a model should account
for all timeseries of scalar statistics of annual wage
income conditioned on education and for the timeseries
of all unconditional scalar statistics of wage income too.
The present paper shows that the macro model of the Inequality
Process (IP) does that, choosing as an example the quirky
timeseries that has roiled U.S. social science, alarmed
the U.S. popular press, and provided rhetorical grist for
one 2004 U.S. presidential candidate. The example is the
rapid increase in wage income nouveaux riches in the U.S.
Poster
Firstpassage time probability distributions in interday FOREX
Kunal Bhattacharya
Satyendra Nath Bose National Centre for Basic Sciences,
BlockJD, SectorIII, Salt Lake, Kolkata700098, India
Abstract:
Firstpassage time probability distributions in interday FOREX.
We have analyzed generalized firstpassage time probability distributions
in the interday foreignexchange data for different countries ranging over
many years. The fluctuations are assumed to be independent and shown to
obey an exponential distribution. This allows to model a time series' as a
random walk problem.
It is seen that the first passage probability densities in
the data can be explained reasonably well in the random walk regime. The above
facts seem to true for almost all the countries. We conclude that even in
the presence of separate background economies the random walk description for
the first passage properties of the interday foreign exchange data is highly
robust.
Talk
Generalized statistical models of economy markets
Marco Patriarca^{1}, Els Heinsalu^{1},Anirban Chakraborti^{2}
^{1}Institute of Theoretical Physics, Tartu University, Tahe 4, 51010 Tartu, Estonia
^{2}Department of Physics, Banaras Hindu University, Varanasi 221005, India
Abstract:
We compare some versions of a statistical model, in which N units
interact with each other exchanging a quantity x, according to a given microscopic
random law depending on some saving parameters. This model can represent e.g. gas
molecules colliding with each other and exchanging energy or economic agents
carrying out transactions and exchanging wealth. A model of Angle is compared with
that of Chakraborti and Chakrabarti and from numerical fitting an equilibrium
gammadistribution of orders n and n' respectively is suggested, with n = n'/2,
for which the explicit dependence on the saving parameter is provided. We
reformulate and study the various models in a way suitable to further
generalizations.
Poster
Monetary wealth distributions under different modes of debt constraints
Siyan Chen, Keqiang Li, Yougui Wang
Department of Systems Science, School of Management,
Beijing Normal University, Beijing, 100875, People's Republic of China
Abstract:
In this paper the distribution of monetary wealth is studied based on a random
transfer model by computer simulations and theoretical analysis. Debt is introduced
to the model with different modes of constraints. With a limit to debt of each
agent, it is shown that the stationary monetary wealth follows the exponential
BoltzmannGibbs law. When the limit is set to the total volume of debt, the
stationary distribution becomes an asymmetric Laplace one. In order to understand
the basic mechanism that underlies the formation of these particular distributions,
we apply the methods of statistical physics to deduce the exact expressions of the
distributions, which are found to be in a good agreement with simulation results
under different limitations over debt.
Poster
Multiphase transition of stock prices and stock index
Kishore Chandra Dash
Dept. of Physics, Neelashaila Mahavidyalaya, Rourkela 769042, Orissa, India
Abstract:
It is very difficult to predict the movement of stock
prices and indices because socioeconomic systems are
much more complex than physical systems even with fractal
nature. Socioeconomic systems are sensitive to different
social, economic, natural or manmade disasters, positive
or negative news, which can come unnoticed unlike that of
physical systems. However it is observed that movement of
stock prices rise or fall up to a certain level and remain
almost stagnant with a small variation. The movement of stock
prices is not observed just like the stagnancy of temperature
when phase transition occurs in case of matters. In this paper
I have tried to compare the price and index movement with that
of the phase transition of matters when they are subjected to
heat supply. However in case of stock prices and indices, there
are multiple phase transitions. In this paper an attempt has
been made to compare stock prices with that of temperature,
demand with supply of heat, supply with extraction of heat,
ratio of volume of transaction to the change in price with
the specific heat and volume transacted during phase transition
with latent heat. Transition due to evaporation and ebullition
with the movement of stock prices has been applied. The comparison
between the liquid and illiquid stock has been attempted. Although
the chart of a stock with price vs. time looks like a gaussian,
it contain a large number of approximated gaussians with
fractals from which the future move of the stock price
may be predicted. Prediction of stock market crash or boom
from the chart has been discussed.
Talk
Debtcredit economic networks of banks and firms: the Italian case
Giulia De Masi
Economics Department, Polytechnic University of Marche, Piazza Martelli, 8  60121 Ancona, Italy
Abstract:
The economic stability is related to the resilience of the whole
system of banks and firms to single firms/banks failures. In general a
single failure of a firm can trigger other events of failures of other
firms. Moreover firms have loans with banks; therefore firms and banks
are interconnected by complex relationships of debtcredit. This
dependence exposes also the banks to a shortage of liquidity or the
risk of failure in the worst cases, as a consequence of firms
failures.
A relationship of creditdebt is present also between different banks
through the interbank market.
European banks provide the quantity of liquidity they need in weekly
auctions with the European Central Bank; then banks can borrow and
lend money each other in the interbank market, in order to fulfil
unexpected withdrawals of customers and the requirement to maintain a
certain deposit in the National Central Bank.
In this work, the focus is on the one hand on the creditdebt
dependences between Italian banks (interbank market), on the other
hand on creditdebt dependences between Italian banks and firms.
The Italian interbank market is an example of a transparent market
where all agents (Italian and foreign banks) have exact information
about transactions of other partners (time, volume, rate, even
identity).
Even if a priori each agent can establish loans with any other, we
observe from real data that transactions happen between partners with
specific characteristics.
We can represent this system using graph theory. We can naturally
define a network where the nodes are banks and the links are the
transactions between pairs of banks.
A similar approach is used to represent the relationships of Italian
firms with banks. A typical pattern is observed. Implications of the
observed relationships architecture on the robustness of the whole
system is analyzed.
Talk
Weighted Network for Scientific Collaboration of Econophysicists:
Statistics and Evolution
Zengru Di
Department of Systems Science, School of Management, Beijing Normal University
Abstract:
The development of Econophysics is studied from the perspective of scientific
communication networks. Papers in Econophysics published recently are collected.
Then a weighted and directed network of scientific communication, including
collaboration, citation and personal discussion, is constructed. Its static
geometrical properties, including degree distribution, weight distribution, weight
per degree, betweenness centrality and community structure, give a nice overall
description of the research works. Inspired by this empirical analysis of
econophysicists network, an evolutionary model for weighted networks is proposed.
Besides a new vertex added in at every time step, old vertices can also attempt to
build up new links, or to reconnect the existing links. The number of connections
repeated between two nodes is converted into the weight of the link. This provides
a natural way for the evolution of link weight. The pathdependent preferential
attachment mechanism with local information is also introduced. It increases the
clustering coefficient of the network significantly. The model shows the
scalefree phenomena in degree and vertex weight distribution. It also gives well
qualitatively consistent behavior with the empirical results.
Poster
Chain Reaction in Market Process
Bijay Bal and Kuntal Ghosh
Saha Institute of Nuclear Physics, India
Abstract:
We are aware of chain reaction in nuclear fission and Chemical reaction. But when a new product tries to enter into the market, it also passes through some similar steps of chain reaction. Chain reaction has the steps like its initiation process, its control and sustaining mechanism, management of waste etc. It may be common experience of daily passengers in train that at the onset it is very difficult to sale a single copy of a new item even after long introduction about the item by the salesman. But as soon as one or two copies of the item are sold in the compartment, a number of copies of the item are sold in no time. These phenomena may be assigned as a case of psychology driven initiation of chain reaction in market process . If the affinity for purchase is very near the critical barrier, the acts of nearest neighbors purchasing the item influences psychologically to overcome the barrier and purchase process follows chain reaction .The introduction of pouch in packaging consumable goods and a variation of its size ( for example) is one of the ways, how the height of the psychological barriers of the consumers can substantially be tuned. The sustenance of this chain reaction depends upon (in addition to the height of psychological barrier) the nearest neighbor separation and availability of money with individual at that occasion.
Typical character of sustenance of sale phenomena has critical and sub critical
Natures. In critical range, the product itself is capable of creating enough appreciation among the consumers and which in turn acts as a positive feedback delighting the product for future sale and a self sustained sale mechanism is observed. In the sub critical region the product may not have the enough appreciation about it?s quality, but the product goes on sale mostly due to continuous attractive advertisement and subsidiary items attached with the product. This sub critical chain reaction persists in market so long as the adequate advertisement and other prize items are present with the product.
Waste management is another important aspect of market process. The excess production rate compared to the sale generates waste. A long term accumulation of this waste (if proper care is not taken in time) generates a negative feedback in market dynamics. As a result the overall cost of the product increases with time and ultimately the over burdened product may be slowly losing the entire market.
Poster
Relaxation Oscillation in the Character of Some Commodities in the Market
Bijay Bal and Kuntal Ghosh
Saha Institute of Nuclear Physics, India
Abstract:
It is our common experience that a section of commodity (specially
man designed food items like Chocolate, Rasgulla, Samosa and
other consumable products like soap, perfumes, shampoo etc.)
is found to have changed with time their size or volume keeping
their geometrical shape and price per unit quanta of the item
unchanged. With a particular price setting starting from a maximum
size the item is found to be decreasing in size with time in a
quasistatic way and regularly sold in market. But as the item
thus reaches a critical size (~50% of maximum), it some way
psychologically makes the purchaser unhappy (faces a psychological
barrier) and the items come back in the market again with its
earlier maximum size with price of unit quanta doubled. Again
with time, the size goes on decreasing slowly keeping price per
unit quanta of the item fixed to new scale and in this way the
size of the item follows a typical pattern of relaxation oscillation
with time. It should also be noted that under the guise of this
process of relaxation oscillation the producer maintains a
continuous increase of the price of unit mass of the ingredients
of the product (approximately linearly with time) without any
well thought significant opposition from the purchaser side
by resorting to a puzzle between the quantum price and price of unit mass.
Talk
Weighted networks at Polish market
M. Chmiel, J. Sienkiewicz, K. Suchecki and J. A. Holyst
Faculty of Physics and Center of Excellence for Complex Systems Research
Warsaw University of Technology, Koszykowa 75, PL 00662 Warsaw, Poland
Abstract:
In the present study we consider relations between companies in Poland taking into
account common branches they belong to. Using a commercial database we construct a
bipartite graph of companies and branches. It is clear that companies belonging to
the
same branch compete for similar customers, so the market induces interactions
between
them. Link weights describe the number of common branches for a companies pair. On
the
other hand two branches can be related by companies acting in both of them. To remove
weak, accidental links we use a concept of "threshold filtering" for weighted
networks
where link weights correspond to a number of existing connections (common companies
or
branches) between a pair of nodes. Using cutoffs of links weights we construct
networks
with different filtering levels and study degree distributions of such networks. We
also
investigate Gibbs entropy of degree distributions to find out the amount of
information
we filter out.
Talk
Autocatalytic networks and economic growth: A mathematical model
Sanjay Jain
Department of Physics and Astrophysics,
University of Delhi, Delhi 110007, India
Abstract:
Poster
Multifractal Properties of the Indian Stock Market
Sunil Kumar^{1,2} and Nivedita Deo^{1}
^{1}Department of Physics and Astrophysics, University of Delhi,
Delhi110007
^{2}Ramjas College, University of Delhi, Delhi110007
Abstract:
We report on a study of the Indian price index (BSE & NSE)
from August, 2002 to February, 2007 using the Multifractal
Detrended Fluctuation Analysis (MFDFA). Numerically we find
that the MFDFA fluctuation function F_{q}(s) shows that the indices
exhibit multifractal properties. The exponent h(q) related to the
Hurst exponent H (h(2) is the Hurst exponent), changes with the
moment q. The Hurst exponent is 0.47571 & 0.46855 for the
BSE and NSE index respectively. In particular the dependence
of the multifractal scaling exponent τ(q) as a function
of q has been explicitly found numerically which shows multifractality.
We also observe that h(q) of these nonstationary time series are
sensitive to the presence of a crash or a boom.
Poster
Social Networks: Examples of Deterministic and Stochastic Processes Modeling
Chitro Majumdar^{1} and René Algesheimer^{2}
^{1}ARW Business House Brussels, Louizalaan 479  Box 50,
Avenue Louise, B1050 Brussels, Belgium
^{2}University of Zurich, Switzerland
Abstract:
Nowadays there is much activity on (social) networks, mainly the work of
economists, mathematicians and statistical physicists. In social networking
the modelings that are deterministic and stochastic.
I have applied deterministic techniques to smallworld networks and
scalefree networks (social networks can be either of these),
but the uses of deterministic modeling are limited.
The two main characteristics of smallworld networks are strong
local clustering and small diameter.
Social networks are highly volatile. There has been a lot of recent
research using stochastic models for these networks. We will give
an example with the variables of a small data set of a virtual social
network, where we are interested in economic variables for the company.
The variables are not normally distributed, but power law distributed.
Thus, as a basic modeling I guess the regression does not require normality.
The critical values of the regression output, however, are only asymptotical.
We could even use Quantile regression in order to reach some interesting
results. We also could suggest some theoretical examples of
stochastic processes (such as pure jump processes, branching processes,
etc.) and taking into account the dynamic properties of social networks since
the beginning.
Poster
Dynamic Financial Analysis as the untrodden path under SolvencyII
Chitro Majumdar
Institute of Mathematical Statistics and Actuarial ScienceBern, Switzerland
Abstract:
Dynamic Financial Analysis (DFA) is the most advance modeling
process in today's property and
Casualty industryallowing us to develop financial forecasts
that integrate the variability and interrelationships of
critical factors affecting our results.
DFA in the capital budgeting decision process of a company
launching a new invention and predicting the impact of the
strategic decision on the balance sheet in a horizon of few years.
To recognize the few factors that will affect the asset liability
cash flow are demand uncertainty, sales volatility, credit risk,
volatility in the price of raw materials cost of capital to name
a few. Each of these random variables can be stochastically simulated
either based on the distribution of retrospective data or under
strategic assumptions. When simulated in a combined way the future
cash flows can be predicted which in return would dictate the
capital requirements in the future. Depending on the capital
structure of the company and simulated interest rate in the
capital market, business cycles and the final earnings volatility
of the company can be predicted to identify the return and associated
risks where DFA would be riskbased insurance pricing, for insurance
companies (under SolvencyII).
Talk
The International Trade Network: weighted network analysis and modelling
K. Bhattacharya^{1}, G. Mukherjee^{1,2},
J. Saramäki^{3}, K. Kaski^{3},
S. S. Manna^{1,3}
^{1}Satyendra Nath Bose National Centre for Basic Sciences,
BlockJD, SectorIII, Salt Lake, Kolkata700098, India
^{2}Bidhan Chandra College, Asansol 713304,
Dt. Burdwan, West Bengal, India
^{3}Laboratory of Computational Engineering,
Helsinki University of Technology, P.O. Box 9203, FIN02015 TKK, Finland
Abstract:
The International Trade Network is studied from the weighted
network perspective using the volumes of mutual annual trade between
two countries as the edge weights. The analysis spans over 53 years
and it shows that the weight distribution is well approximated
by a lognormal distribution. Moreover, the strength of a node,
which is the total trade volume of a country in a year,
is observed to grow algebraically with the Gross Domestic Product
over all years. In addition, a small number of richest countries
is seen to form a strong community  the ``richclub'' 
whose internal trade comprises a major fraction
of the total volume of international trade. Interestingly
the size of the rich club over the time span of 53 years from
1948 to 2000 was found to shrink to less than
half of its starting value. Many of the
empirical features of ITN are reproduced by a simple model, the starting
point of which is the wellknown gravity model of international trade.
Talk
Econophysics: Calculus vs. Economic Standard Models
Juergen Mimkes
Physics Department, University of Paderborn, Germany
Abstract:
Econophysics applies methods of physics to economics. "Ex post"
and "ex ante" calculations and economic growth may be explained by
"path dependent" integrals:
Y  C = 0: At zero growth income (Y) and consumption costs (C) are equal.
The total differential forms dY and dC are not path depending and are
known "ex ante": the resulting output is zero. A Cobb Douglas function,
Y = AKαL^{1α} may be assumed depending on capital K,
labor L and technology A. Income and consumption per laborer,
y = Y/L = Akα, will both grow according to
dy/y = αdk/k + dA/A.
Standard economic models may be valid for rich countries with (nearly)
no economic growth.
Y  C ≠ 0: In economies with real growth income δY is a not exact
differential form. Y and C are path dependent integrals and cannot be
calculated "ex ante", without knowledge of the production process.
A general Cobb Douglas function Y does not exist, standard economic
models will not apply. Economic growth must be calculated from calculus:
δy/k = αdk/k  df. The production function ( df) replaces
technology (A) and corresponds to negative entropy, to reduction of
disorder, to a better infrastructure of the economic system.
These results will apply to poor countries with high increase of GDP.
The production function f introduces entropy to economics: Industry is a
Carnot machine: Production of goods is entropy reduction (Δf < 0)
at low price, trade is distribution of commodities or entropy production
(Δf > 0) at high price. The Carnot process may act like a heat
pump and draw capital from poor countries to rich countries, or run like
a motor. The fuel for cars and economies is the same: oil.
Poster
Analytics and Processes of derivatives pricing
Jyotishka Dutta, Avishek Ghosh, Rohit Patel, Arnab Barat
Indian Statistical Institute, 203, B.T. Road, kolkata, 700108
Abstract:
The finacial market around the world is a complex process. Now the more hot
topic is the options market.
The dynamics of this finantial quotes are noteable. Much work has been done
to model them and try for prediction.
We firstly try the knowledge of the stochastical processes and try to show
them an simplified eto process and then,
modify it to further complicated models. Thereafter we try pure and simple
data analysis to suggest a time series model.
Finally it's good to try and see volatility of different quotes and try to
predict some futuristic trend.
To explore,Understand and implement the methodology of polynomial tree used
to price Multiasset derivatives.
Talk
Variations in Financial Time Series: Modelling through Wavelets
and Genetic Programming
Dilip P. Ahalpara^{1}, Prasanta K. Panigrahi^{2}, Jitendra C. Parikh^{2}
^{1}Institute for Plasma Research, Near Indira Bridge, Gandhinagar382428, India
^{2}Physical Research Laboratory, Navrangpura, Ahmedabad380009, India
Abstract:
We analyze the variations in S & P CNX NSE daily closing index
stock values through discrete
wavelets. Transients and random high frequency components are
effectively isolated from the
time series. Subsequently, small scale variations as
captured by Daubechies level 3 and 4 wavelet
coefficients and modelled by genetic programming.
We have smoothened the variations using Spline
interpolation method, after which it is found that
genetic programming captures the dynamical
variations quite well through Pade type of map equations.
The lowpass coefficients representing
the smooth part of the data has also been modelled.
We further study the nature of the temporal
variations in the returns.
Talk
Empirical studies and models of income distributions in society
Peter Richmond
School of Physics, Trinity College, Dublin 2, Ireland
Abstract:
We review early and more recent studies of income and wealth
distributions in society. Various approaches to theoretical models will be
assessed and compared in detail to data for the UK during the period
19922002.
Talk
Estimation of delay in information flow among stocks
M. S. Santhanam
Theoretical Physics and Complex Systems Division,
Physical Research Laboratory, Navrangpura, Ahmedabad 380 009, India
Abstract:
We study BSE stock market data. It is known that there are groups of
stocks that tend to display same kind of dynamics. From the studies on
stock crosscorrelations and random matrix theory, it is also known that
there are individual stocks that are anticorrelated. We focus on these
individual stocks and study their dynamics. They are (anti) correlated
even though they do not organically belong to the same industry. We
estimate the delay in interactions between these individual stocks
using crosscorrelation and synchronization techniques. We propose a
mechanism using driven coupled map lattices that can lead to such
interactions.
Talk
Knowledge Sharing and R & D Investment
Abhirup Sarkar
Economics Research Unit,
Indian Statistical Institute, 203, B. T. Road, Kolkata  700 035
Abstract:
We consider an R & D race between two symmetric firms.
The game consists of
two stages. In the first stage, firms noncooperatively decide upon their
levels of investment in R & D which, in turn, determine the Poisson
probabilities of their subsequent sucesses. In the second stage, they engage
in a Nash bargaining game to share their knowledge. We show that the firms
overinvest and earn lower profits if knowledge sharing is possible compared
to the situation where it is not. Hence, before the first stage, if the
firms are given the option of precommitting to no knowledge sharing, they
will do so and be better off.
Poster
Recurrence analysis of financial time series
Apu Sarkar
Variable Energy Cyclotron Centre,
1/AF Bidhan Nagar, Kolkata 700064, India
Abstract:
Recurrence plot (RP) is a quite easy tool used in timeseries analysis,
in particular for measuring unstable periodic orbits embedded in a
chaotic dynamical system. Recurrence quantification analysis (RQA)
is an advanced tool that allows the study of intrinsic complexity
of a dynamical system with a set of few parameters.
These methods yield a deeper understanding of the underlying
process of a given time series and are applicable to study
nonstationary time series. In this work. we have
used RP and RQA to study the dynamical behaviour
of the Indian financial market. We
have studied time series data from Indian foreign
exchange market and Bombay stock
market using these methodologies.
Talk
Dynamical structure of behavioral similarities of the market
participants in the foreign exchange market
AkiHiro Sato
Department of Applied Mathematics and Physics,
Graduate School of Informatics, Kyoto University
Abstract:
The tick frequencies for currency pairs in the foreign exchange
market, defined by the number of tick quotation per unit time, are
investigated. In order to measure the behavioral similarity of the
market participants several measures (crosscorrelation coefficients,
phase correlation functions defined by similarity between two phase
spectra, spectral distances defined by the Kullback Leibler divergence
between two power spectra, and similarity between two spontaneous phases)
are employed. From numerical simulations of the agentbased model of a
financial market it is confirmed that these measures quantify
similarities among agent parameters. By using these measures dynamical
structure of behavioral similarities of the market participants in the
foreign exchange market is calculated. These results imply that the
market participants behave changing their parameters slowly. This
finding is applicable to measuring risks of portfolio with high
resolution.
Talk
Collective Behavior in the Indian Stock Market:
Crosscorrelation structure of stock movement in NSE
Sitabhra Sinha and Raj Kumar Pan
The Institute of Mathematical Sciences, CIT Campus,
Taramani, Chennai 600113
Abstract:
In the first ever detailed study of the
internal structure of a market other than NYSE, we
analyze the interactions between the most frequently
traded stocks in the National Stock Exchange (NSE) of
India. We have performed an eigenanalysis of the
crosscorrelation structure using daily returns of 201
frequently traded stocks over a period of more than a
decade, coinciding with the period of rapid
transformation of the Indian market as it emerged to
become one of the world's largest. We find absence of
distinct sector identity in the market, when compared
to NYSE, and the movement of stocks is dominantly
influenced by the overall market trend. This
observation fits with the general belief that emerging
markets tend to be more correlated than developed
markets. We also present a twofactor model of return
dynamics, which shows how the intermediate eigenvalues
depend systematically on the relative strength of
sector identity, to substantiate that the Indian
financial market does not have the internal structure
of multiple groups of comoving stocks as seen in
developed markets like NYSE.
Talk
Is Inequality Inevitable in Organized Societies ?:
Income distribution as a consequence of resource flow
in hierarchical structures
Sitabhra Sinha
The Institute of Mathematical Sciences, CIT Campus,
Taramani, Chennai 600113
Abstract:
Almost all organized societies, once they attain a
certain level of complexity, exhibit inequality in
terms of income of its members. Hierarchical
stratification of social classes is the major
contributor to such unequal distribution of income,
with intraclass variation often being negligible
compared to interclass differences. In this talk, we
will explore examples from different historical
periods, ranging from medieval Byzantium to the Mughal
empire of India in 17th century, and different kinds
of organizations, from criminal gangs in USA to
Manufacturing & IT Services companies in India, to
show that hierarchical structure of the organization
lies behind the observed income inequality in
societies. As income distribution can therefore be
seen as a consequence of resource flow in a
hierarchically structured network, we will then
present a model of how such organizations can arise in
a system of interacting agents, and show that
empirically observed income inequality can be
explained as a consequence of the division of the
assets inflow at various levels of
such an organization.
Talk
Networks of firms and a ridge in the production space
Wataru Souma
NiCT/ATR CIS Applied Network Science Lab.,
222, Hikaridai, Seikacho, Sorakugun, Kyoto, 6190288, Japan
Abstract:
We consider complex networks in economics. As is well known, networks
are constructed
from nodes and links. In this study, we consider firms as nodes.
Thus, links represent many
kinds of relationships between firms. As these relationships, we
consider shareholding,
transaction, interlocking directors, and joint application of patent.
Through network analysis,
we clarify topological characteristics of these networks. In
addition, we consider relationships
between dynamics of firms and these networks, and propose
mathematical models that can
explain both of dynamics of firms and growth of networks.
We also consider dynamics of firms in the production space that is
characterized by capital
stock, employment, and profit. Hence, in this space, each firm moves
to maximize profit by
controlling of capital stock and employment. We show that dynamics of
rational firms are
described by a ridge equation. We analytically solve this equation by
assuming the
CobbDouglas production function, and obtain a solution. We discuss
the efficiency of
management of firms by comparing of this solution and empirical values.
